Venezuela’s backslide has been rapid and devastating. Perhaps the most stunning example of the deterioration of the state has been the reemergence of malaria. By 1960 Venezuela had eradicated the disease from its urban areas, which helped set it on a path to economic prosperity for the next few decades. Despite political turmoil and a recession in the late 20th century, Venezuela was regarded as the wealthiest nation in South America up through 2001. Its comfortable perch atop the largest proven petroleum reserves in the world seemed to ensure lasting dominance in the region. Flashforward to today, malaria has spread at the highest levels in 75 years, and sick and dying people are met by extreme shortages of medical supplies in crumbling hospitals. The nation is now engulfed by massive political protests, sparked by widespread frustration over the failing healthcare system, severe shortages of food and rampant government corruption. While the situation may perplex the outside observer, a culmination of problems had been simmering for decades. Above all, the massive reserves of oil that were expected to be a catalyst to prosperity have instead catalyzed its downfall. Venezuela, like many other resource rich countries around the world, has fallen victim to the resource curse.

The first seeds of the crisis were planted in 1999, when the charismatic and deeply polarizing president, Hugo Chavez, came to power. As the price of oil soared in the beginning of the 21st century, Chavez amped up public spending and became the champion of the lower class. His policies – such as fixing the price of foodstuffs and using resource rents to build homes and clinics for the poor – were fueled by profits from the state-run oil company, PDVSA. The initially prosperous regime hinged entirely on the performance of oil in the world markets. When Chavez passed away in 2013, this fragile system was inherited by his political successor, Nícolas Maduro.

In 2014 oil prices fell, PDVSA saw its profits dry up and Venezuela began its tailspin. By several measures, Venezuela has the world’s worst performing economy. In 2016 inflation rose by an astounding 800% and the economy contracted by 18.6%. Hyperinflation has obliterated the salaries of many middle class citizens. Desperate to make ends meet, people have flocked from cities to the gold mines. The swampy mines are a breeding ground for malaria infested mosquitos, and thus are culpable for the return of the disease. No longer able to rely on profits from PDVSA to import essential goods, the effects of the disease have been exacerbated by severe shortages of medicine. Hospitals lack access to such basic necessities as sutures, gloves and electricity. Similarly, the plummeting value of the bolivar has limited Venezuela’s capacity to afford basic food imports, and as a result the nation faces severe food shortages. Today buying groceries entails waiting in line for hours, with no guarantee of getting what you came for.

Massive political protests and and civil unrest have erupted around the nation as citizens grow increasingly frustrated by Maduro’s inaction. Rather than instituting economic reform he has pointed a finger at the US and political adversaries, and accused them of crafting an “economic war” to ruin the country. Unable to address the crisis and lacking in Chavez’s charisma, Maduro has become deeply unpopular with the Venezuelan people. His approval rating fell to a nine month low of 21% in July 2016. Maduro has reacted by tightening his grip on power and violently suppressing protests. Calls for a referendum to oust him from the presidency have thus far been stamped out by the National Electoral Council, and in March the Supreme Court annulled the democratically elected National Assembly. For all intents and purposes, Maduro has assumed the role of dictator with minimal checks and balances on his power.

Unfortunately, Maduro’s failure to acknowledge the root cause of the crisis has made it impossible for any meaningful changes to occur. Venezuela’s economic woes are not the design of political opponents, but rather the result of the gross mismanagement of oil wealth. The problem may seem counterintuitive; massive reserves of crude oil should be a blessing to a developing country. Nonetheless, this phenomenon can be observed in resource rich countries all over the world. The resource curse is multifaceted and complex, however there are three components that are especially relevant to Venezuela’s current situation: Dutch disease, trade shocks and corruption. Dutch disease occurs when resource exports cause a country’s currency to rise in value, which makes other export activities – such as manufacturing – uncompetitive in world markets, and effectively crowds them out. Dutch disease creates an economy that is vulnerable to trade shocks and the volatility of natural resource revenues. In Venezuela, crude oil now accounts for 96% of total exports, and thus the economy is extremely sensitive to any fluctuations in oil prices.

Perhaps the most fundamental consequence of the resource curse in Venezuela, however, has been widespread corruption. The government’s ability to use oil wealth to fund projects decreases tax burdens placed on its citizens. While this may seem like a benefit to Venezuelans, it also has the effect of decreasing the government’s accountability. Massive influxes of oil wealth combined with weak institutions and low transparency have created an environment of rampant corruption.

The good news is that the resource curse can be broken. The evidence is in the case of Botswana. Botswana is one of the most resource-rich countries in the world, especially notable for its abundance of diamonds. Unlike most resource-rich developing countries, Botswana has experienced marked economic growth and stability for the past several decades. In fact, the government has been so stable that in 2013 the leading diamond conglomerate, Da Beers, relocated its sales department to Botswana’s capital city. Botswana’s success has been attributed to sound democratic institutions and strong private property and anti-corruption laws. Of course, Botswana and Venezuela are different nations with different histories, and thus policies that work in Botswana may not apply to Venezuela. However, it should be noted that corruption in Venezuela has not been a constant. In the 1960s, Venezuela boasted a democratic government with high levels of transparency, which served as a model to other developing Latin American countries. The increase in corruption in the 1970s directly coincided with a boom in the oil industry. If nothing else, Botswana is a testament to the importance of strong institutions and transparency in the management of natural resource wealth.

Venezuela has now reached a breaking point. Maduro repeatedly demonstrates his unwillingness to implement critical reforms, and with each passing day it seems less likely he will surrender power peacefully. A political change is necessary, and as pressure mounts, a regime overthrow appears imminent. Maduro’s successor will have to act quickly to pull Venezuela back from the brink. With proper leadership and reforms, Venezuela could return to pre-crisis oil production within five years, and would be able to import enough basic goods to alleviate crushing shortages. To start, the new government must increase transparency and move away from Chavista socialist economics by adopting market-friendly policies and ending its reliance on PDVSA to fund social programs. In the long-term, major institutional reforms will be necessary to ensure a stable democracy and a prosperous economy. Furthermore, reviving idling manufacturing and agricultural industries will be vital to diversifying the economy and curing Dutch Disease. These changes will not happen overnight. However, with the responsible management of oil wealth and good governance, Venezuela could eventually transform its resource curse into a blessing.

Venezuela’s Resource Curse was last modified: June 6th, 2017 by Katie Linder

The 2016 presidential election will no doubt remain a controversial subject in the coming years. Many feminists, excited at the prospect of America’s first female president, must now come to terms with the reality that the “highest and hardest” glass ceiling will remain unbroken for at least four more years. However, the United States is not alone in its continued failure to elect a woman to its highest government office. Despite the progress made around the world to expand the rights of women, a lack of gender parity remains painfully clear in the realm of leadership. Women occupy around 10% of the highest offices in national governments around the world, with 19 women currently serving as head of state/government. One of the most formidable female leaders today is Germany’s Chancellor Angela Merkel. Merkel’s unconventional rise to power serves as an inspiration to aspiring female leaders and further dismantles society’s male-centric conception of power and leadership. However, her legacy also highlights the many double-edged swords facing women in power that make the glass ceiling so difficult to break through.

As a politician in Germany, Merkel is an outlier. She grew up in East Germany during the Cold War and was originally trained in the sciences. Her origins made her an outsider in German politics, which were dominated by men from the West. Nevertheless, she turned her perceived weaknesses into strengths. She used the patience, intellect and inconspicuousness that she cultivated in the East to propel her political career. Furthermore, her background in science allowed her to grow more comfortable working in a male dominated field, and has influenced many aspects of her political style. She is an unanimated public speaker; her speeches are devoid of the pompousness and inflated rhetoric that are characteristic of many other world leaders. She is notorious for delaying her decisions for as long as possible in order to analyze all the available data, and has developed a political style that is based on pragmatism and facts rather than any ideological convictions. In fact, it has been said her only deep seated conviction is her value for freedom, everything else “is negotiable”.

Merkel’s unique style of leadership has allowed her to cultivate a level of respect among the German people that secured her three consecutive terms as chancellor. However, despite her success, she has faced more than her fair share of obstacles in the form of both overt and subtle sexism. While she has risen above the insults and criticism admirably, her experiences reveal the contradictory attitudes surrounding female leadership, and the fine line women in power must walk. While every country and culture has a unique set of standards for their leadership, many of the challenges faced by Merkel are universal to women seeking power.

Merkel developed an ability to restrain herself and lead from behind through her experience studying alongside primarily male colleagues at Leipzig University. She once joked, “The men in the laboratory always had their hands on all the buttons at the same time. I couldn’t keep up with this, because I was thinking. And then things suddenly went ‘poof,’ and the equipment was destroyed.” Throughout her political career she has stood her ground and dealt with the particularly “macho” male leaders, such as Vladimir Putin, in a similar fashion. Merkel’s tactics can serve as a model for other aspiring female leaders, but her experiences also reveal a troubling truth. Female leaders must remain composed in order to avoid being labeled emotional or abrasive, but if they are too diffident they risk having their voices drowned out. Merkel’s lead from behind style of leadership has allowed her to work around this double-edged sword, but it is not necessarily the most efficient way to lead. Ultimately, placing rigid expectations on women hinders their ability to be effectual leaders.

Contradictions between expectations of Merkel’s femininity and masculinity also came into play during her rise to power. The now popular and affectionate nickname “Mutti” (German word for mother), was originally thrown at her as an insult. She has since gracefully reclaimed the name, arguing that it implies her responsibility to the German people. Her appearance has come under scrutiny as well, particularly at the beginning of her career. She has updated her style over time but has largely ignored the critics and maintained a plain and unassuming wardrobe. In this way she has sent the message that she prioritizes her work over her appearance and wants to keep the focus on her policy. These experiences reveal another double-edged sword: as a woman Merkel is expected to be feminine, matronly and stylish, although these traits are often seen as incompatible with strong leadership. After centuries of primarily male leaders, our notions of masculinity and leadership are intimately intertwined. In order to be taken seriously, a woman must adopt more traditionally masculine traits such as resoluteness and aggression. However, acting too masculine often makes a woman less likeable to a broad audience.

Merkel has also received criticism at the other end of the spectrum from feminists who are dismayed by her failure to adequately address women’s issues in Germany. Merkel herself has said she doesn’t consider herself a feminist. Although she has made efforts throughout her career to advance women’s rights, such as adding gender equality in the workplace to the G7 summit agenda in 2015, women’s issues have remained largely on the periphery of her policy goals. The harsh criticism Merkel has received from feminists is fueled in part by the idea that women understand the challenges posed by gender barriers, and thus have an obligation to help each other whenever possible; as Secretary of State Madeleine Albright once said, “There’s a special place in hell for women who don’t help each other”. Merkel’s actions reveal another troubling double-edged sword: those with the most power to advance women’s rights—women in the highest offices of government—often adopt passive stances, perhaps because acting otherwise could amount to political suicide. When a woman seeking a high leadership role champions women’s rights and runs on a feminist platform, it is seen with suspicion by many and cast as self-serving. Thus, it is very difficult for an outspoken feminist to get elected to a high office. There is no doubt that having more female leaders is a positive step towards gender equality. However, their power would be much more consequential if it were wielded to directly advance women’s issues.

While more active advocacy for women’s issues from Merkel is necessary, her contributions to the women’s movement must still be recognized and appreciated. She garnered respect in boardrooms dominated by men as she led Europe through the Eurozone Crisis and continues to tackle the Refugee Crisis; thus she has expanded respect for female voices in important international policy discussions. Ultimately, Merkel can serve as both an inspiration and a sobering lesson to other aspiring female leaders. She is an example to women everywhere of strong female leadership that has risen above sexist criticism and “macho men”. However, her legacy is riddled with the double-edged swords that have prevented many other women from achieving the same success. Hopefully, America’s aspiring first-female-presidents will learn a lesson from Merkel and shatter the highest glass ceiling once and for all.

The Double-Edged Sword of Female Leadership was last modified: February 9th, 2017 by Katie Linder

Although it remains an issue of contentious debate, the Iran Nuclear Deal has been widely regarded as a necessary step to ensure international security and nuclear nonproliferation. However, the implications of the deal go far beyond curtailing Iran’s nuclear program. It has already impacted the global crude oil market as Iran’s fight to regain its pre-sanctions market share has depreciated low oil prices even further. A less discernible, but equally important, consequence of the deal is the environmental impact. Iran now faces two conflicting pressures: a need to revive and grow its economy through crude oil exports and the pressure to become a more environmentally sustainable nation. Ultimately, if Iranian officials are able to balance these two pressures the deal could prove to be a critical step towards a cleaner and more sustainable future in Iran.

The sanctions imposed on Iran took an incredible toll on the health of the national economy. It is estimated that GDP shrank by around 9% under sanctions and oil exports decreased from 2.6 million barrels a day in 2011 to 1.4 million barrels a day in 2014. Now that the sanctions have been lifted Iran has the opportunity to revive its economy. However this potential is complicated by the fact that oil prices have dropped substantially in recent years as supply outpaces demand. Other nations with oil-based economies have pushed to freeze production in order to increase prices, but Iran has continuously refused to comply with this initiative. Despite the low prices Iran remains intent on regaining, or even surpassing, its pre-sanction market share with aims to raise productive capacity to 5.7 million barrels a day by 2020.

In addition to the adverse economic effects, the sanctions also contributed to major environmental crises in Iran that must now be addressed. By cutting off access to essential imported resources, Iran was forced to adopt “survivalist” means of overcoming shortages at the expense of environmental considerations. Unable to import refined oil, Iran developed its own oil refineries that produced petrol with ten times the contaminants of imported fuel. The use of contaminated petrol has contributed to dangerous levels of air pollution in many cities- the city of Zarbol in Iran is currently the most polluted city in the world. Furthermore, Iran was forced to expand water resource infrastructure, which depleted their already scarce natural reserves of groundwater and dried up vital rivers and lakes. Now that the sanctions have been lifted Iran has regained access to cleaner fuel, however the dire conditions will not dissipate without a concerted effort from the government.

In addition to the environmental degradation indirectly caused by the sanctions, Iran is particularly vulnerable to the effects of climate change. Iran is already susceptible to high temperatures, desertification and drought; climate change has exacerbated these issues further. During the 2015 Paris Conference Iranian officials acknowledged the need to address climate change, but only pledged a 4% reduction in greenhouse gas emission by 2030 (or 12% contingent on $35 billion in international support). Even a reduction of this amount will be challenging due to Iran’s conflicting goal to drastically expand oil production within the next few decades.

A possible solution to Iran’s environmental and economic ailments is for the country to shift away from a reliance on oil in favor of more renewable energies. Without sanctions, Iran now has access to the foreign capital and technological assistance necessary to make alternative energy a viable economic solution. Furthermore, the cost of producing wind and solar energy is steadily declining, making it an opportune time for Iran to amp up its investments and distinguish itself as a global power in alternative energies and keep up with other nations in the region, such as Saudi Arabia, that have already invested in alternative energy. Its location along several major wind corridors and large regions in the northwest and southeast that receive 300 days of sun per year make Iran uniquely suited to harness enormous amounts of wind and solar energy.

The Iranian government has recognized alternative energies as a promising new industry and has created compelling incentives to attract foreign investors, such as guaranteed government purchases for 20 years. In particular private investors in Western nations, such as Germany, Spain, Denmark and Italy, have already expressed interest in cooperating with Iran to develop renewable energy. The Iranian power developer, Sunir, and the Spanish company, Bester, have entered into a partnership to design and construct infrastructure with the intention of significantly expanding the country’s solar energy potential by 2020. Partnerships such as this will be crucial to the success of renewable energy development in Iran. The sector is still in its infancy, and although Iran has enormous natural potential and a skilled workforce, it currently lacks the capital and expertise to expand renewable energy production on a grand scale.

Iran now finds itself at a crossroad. While the increased production of oil will no doubt provide much needed respite for the crippled Iranian economy, officials and policymakers must heavily consider the fact that a strong oil industry may only be economically beneficial in the short term. The global push to mitigate climate change and shift to alternative energies suggests that demand- and consequently the price- for oil will follow a downward trend in the long term. By distinguishing themselves as leaders in alternative energy early on, Iran will not only secure themselves a more prosperous economic future, but also a cleaner and more environmentally sustainable future.

Iran at a Crossroad: Balancing Economic and Environmental Pressures was last modified: November 9th, 2016 by Katie Linder

The outcome of the European Union (EU) referendum in the United Kingdom (UK) has ushered in a period of geopolitical and economic uncertainty. As the UK grapples with the transition, the Obama administration has vowed to uphold the “special relationship” between the two countries. Maintaining strong ties with the UK is imperative to preserving a stable international system, and it is only appropriate for the United States (US) to respect the democratic processes that led to the Brexit victory. However, the implications of its success must not be ignored. Brexit serves as definitive proof that fears and frustrations resulting from new trends in globalization are a powerful force. Propelled by those same forces, Donald Trump’s campaign has a real shot at securing him a spot in the oval office.

UK involvement in the EU is a multi-faceted issue deserving of debate, however the anti-immigration misinformation spread by Leave campaigners undermined efforts to engage in informed dialogue. The core of the campaign was an appeal to xenophobic sentiment and the belief that EU immigration is harmful to the economic prospects of UK nationals. However, studies indicate there is no correlation at either the national or local level between immigration and unemployment or lower wages. Furthermore, there is no guarantee leaving the EU will curb immigration. The UK will likely maintain relatively unrestricted immigration policies within the EU in order to negotiate favorable trade deals, much like Norway and Switzerland. By shifting the focus of the campaign to an argument with a shaky factual basis, the success of the referendum hinged on cultivating a climate of fear in which facts were eclipsed by impassioned rhetoric. The anger which fueled Brexit has not dissipated after the vote, and as time goes on, the Leave leaders’ inability to deliver on their promises will only exacerbate social and political tensions.

The events in the UK may seem inconsequential to the US electorate, but the parallels between the rise of Donald Trump and the success of Brexit are important to consider as the presidential election approaches. Trump’s movement shares a reliance on nostalgia and intense nationalism, as well as the tendency to blame outsiders—both foreign powers and immigrants—for the troubles of the nation. His no-nonsense stance on immigration has become one of his strongest selling points, but poses the same problems as Brexit by oversimplifying and manipulating facts. Trump claims that immigrants usurp US jobs. However, this idea relies on the assumption that there is a finite supply of jobs in the country. In reality, the economy is more complex than that. A growing immigrant population not only creates a larger labor force, it also creates a larger consumer base, which stimulates economic growth. Studies show that immigrants do not displace native workers, rather they allow for labor specialization. Unskilled immigrants fill less desirable manual-labor jobs and create opportunities for native-born workers to take up more managerial level positions where strong English skills are required. Furthermore, some sectors of the economy are heavily dependent on immigrant labor, such as agriculture where nearly half of those employed are undocumented immigrants. Trump’s proposed deportation of 11 million undocumented immigrants would result in the loss of many jobs for US citizens whose industries are reliant on immigrant labor and lead to a private-sector decline amounting to billions of dollars.

Trump’s movement is rooted in the same conditions that propelled the success of Brexit: an environment where fear and anger cloud judgement. He exploited fear during the Republican National Convention, in which the night’s theme was “make America safe again.” The nation’s insecurity was blamed in part on undocumented immigrants with criminal histories who “roam free to threaten peaceful citizens”. Trump failed to mention that the national crime rate has been dropping steadily over the years and that undocumented immigrants are no more likely to commit crimes than native born citizens. The lack of context offered by his claims fuels hostility towards all undocumented immigrants, including the vast majority who hold no criminal record. By demonizing immigrants, Trump is promoting divisive rhetoric and intensifying cultural and ethnic schisms at a time when the US is already polarized. The consequences of this campaign tactic are evident in the UK, which has experienced an uptick in hate crimes towards immigrants since the referendum. Similarly, the prevalence of violence at Trump’s rallies will likely escalate as the election continues. His failure to adequately address the hostility surrounding his campaign and his active encouragement of violence should be a red flag; he is a candidate that thrives on chaos.

Of course, challenging the visions of Trump and the Leave campaigners should not be confused with an attempt to dismiss the concerns of their supporters. We must acknowledge that the anger they have stirred up is legitimate, but misdirected. The troubles of the working class should not be blamed on one specific country or group of people, but rather on the ubiquitous force of globalization. While virtually all economists would agree that an increasingly integrated global economy is beneficial overall, it inevitably creates distinct winners and losers. In wealthy and technology-rich countries like the US and UK, the winners are skilled workers employed in the service and tech sectors, while the losers are the blue-collar manufacturing workers. As a result, many in the working class want to turn back the clock to a time when manufacturing was strong by implementing strict immigration reform and protectionist trade policies. Unfortunately, the costs of an attempt to halt globalization and free trade would outweigh any benefits. It would slow economic growth, raise the price of consumer goods, and likely cause other countries to retaliate by putting tariffs on our exports. Therefore, we should be approaching the concerns of the working class in other ways; perhaps by expanding social welfare programs or promoting subsidized job training programs, like Trade Adjustment Assistance, that aim to get trade-affected workers back on their feet in a more prosperous industry.

Overall, the phenomenon of different classes of people pitted against each other is not a new one. However, globalization has heightened class tensions to a point where demagogues like Trump and Boris Johnson are able to gain influence by capitalizing on these frustrations. The reality is, while Trump’s movement has given a voice to people who need it, his angry vows to “make America great again” are hollow. Devoid of an acceptance of reality, his proposed policies would do more harm than good. We must tread carefully in the upcoming election. No matter what the outcome is, the divisions in US society that Trump has exploited will not go away and should be approached with pragmatism and empathy.

Globalization and the Power of a Hollow Promise was last modified: August 21st, 2016 by Katie Linder